The Chief Executive Officer of the Ghana Chamber of Telecommunications, Ken Ashigbey, says the government’s agenda to digitize the economy will make it easier for payment of taxes, especially by the country’s informal sector.

Collection of taxes from people within the informal sector has remained one of the biggest challenges for the Ghana Revenue Authority.

Although the informal sector contributes about 70 percent to the country’s economy, just two percent of them pay their taxes.

To this end, the tax collectors have over the years initiated various programs to encourage individuals such as traders and commercial drivers to fulfill their civil obligations, but that has not yielded much results.

But according to Mr. Ashigbey, it would be beneficial to embrace a more digitized way of taxing to widen the tax net and capture all Ghanaians so as to gain more revenue for the country.

He said, “The challenge in Ghana is that there are a lot more people who are outside the tax net. Because of that, our tax rate is quite high. It is those in the formal sector who pay their PAYE but most of those in the informal sector who make a lot more money do not pay their taxes.

“That’s why government’s digital strategy is so important. Not only would it make the tax collection efficient and ensure that all the loopholes that exist can be cut off but it also can spread the tax net so that we can reduce the incidence of the taxation, get a few more people into the tax net and get more money for people.”

SMEs to pay taxes online

The Vice President of Ghana, Dr. Mahamudu Bawumia, had earlier promised if the New Patriotic Party (NPP) is given the nod to govern the country for another term, small businesses will pay their taxes online.

At the official launch of the NPP manifesto at Cape Coast on August 22, 2020, Dr. Bawumia stated that this new development will make it easier to monitor the payment of taxes by Small and Medium Scale Enterprises (SMEs).

He further stated that every small business will have a unique identification in order to monitor all businesses effectively.

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